Table of Contents Executive summary2 Introduction2 PART 1: CURRENT SITUATION ANALYSIS2 I. ASIAN WRISTWATCH MARKET2 II. TISSOT INDUSTRY3 1. History3 2. Sales analysis4 3. Marketing and sales5 III. PROBLEM6 1. Viet Nam Environment6 2. Swot Analysis7 3. Unique Selling Proposition (USP)9 PART 2: RECOMMENDATION9 I. Growth opportunities of Tissot10 II. Market Segmentation – Positioning of New wristwatch. 11 1. Segment Targeting11 2. Positioning12 III. Selected Marketing Strategy12 PART 3: CONCLUSION13 Appendix:13 REFERENCE13 Executive summary Asia is a potential market for Tissot as well as Viet Nam.
Although Tissot launched into Viet Nam for many years, however, it is unknown with many Vietnamese people. The reason is ineffective marketing strategies so it doesn’t attract Vietnamese customers. It affects development of Tissot at Viet Nam market. In addition, Tissot has to face to big competitor is replica Chinese wristwatch with cheap price and various design. The recommendation for Tissot focuses on promotion and advertising. Tissot should contact with singers or models to make advertising through TV, online, newspaper. Besides, Introduction Tissot come to Viet Nam so soon, but it is still unknown brand in Viet Nam.
Therefore I choose topic: “MARKETING STRATEGY OF TISSOT IN VIET NAM” to investigate and analyze Tissot’s marketing strategies, then give suggestions for Tissot’s future development in Viet Nam. The lay- out of topic includes: * Part 1 : Current situation analysis * Part 2 : Recommendation * Part 3 : Conclusion PART 1: CURRENT SITUATION ANALYSIS I. ASIAN WRISTWATCH MARKET By the growing strength of Asian economies, Asian becomes the most potential market for Swiss watch exports. In 2009 Swiss exports to emerging Asian economies has grown 6% compared to an EU average of 4. per cent (Following federation of the Swiss Watch Industry FH 2010 [1]). In first nine months of 2010 shows the growth of exporting watch to Asian market outstripping those to Europe. Exports to the EU had grown by 4. 2 per cent up to the end of September, compared to an increase of 25 per cent to China, 46 per cent to Singapore, 26 per cent to Russia, 21 per cent to Brazil and 19 per cent to India (swissinfo. ch [2]) II. TISSOT INDUSTRY History In 1853 Tissot was founded as a Swiss watch company by Charles-Felicien Tissot and his son Charles-Emile in Le Locle, Switzerland.
The company became an official timekeeper for world championships like cycling, motorcycling, fencing, cricket and ice hockey. It also participated at the Davis Cup in 1957 and Downhill Skiing Switzerland in 1938. Tissot also contributed as a key sponsor for F1 teams like Lotus, Renault and Sauber Currently, Tissot Company is available in more than 150 countries. This brand focuses on developing high-tech products, special materials and advanced functionality In 1985 Tissot became a member of the Swatch Group – the Group manufacture and distribute the world’s largest clock.
Tissot’s watch collections include: T-gold, T-Trend, T-Classic, T-Pocket, T-Sport and Heritage. [3] Sales analysis In the end of 2009, revenue of Swiss watch industry dropped 21. 3 per cent. The world’s largest selling brand Rolex, with revenues of over $3 billion, fell by 35 per cent. Omega, Longines, Rado, Seiko, Citizen and every other prominent brand lost revenue in 2009. However, in 2009 Tissot increased both volume sales by 2 per cent to 2. 21 million and its revenue by 4 per cent. (Sources: thehindubusinessline. com [4]) Tissot sold 152000 pieces in its home market, 200000 pieces and 30000 pieces in both China and India.
The average selling price of a Tissot watch was 430 Swiss francs (around Rs. 18,300) (sources: Watchmarketreview. com [5]). TISSOT market share is 27. 7% compared with CASIO’s market share was 20. 5% and MIDO’s market share was 13. 6%. Other brands are relatively small. [6] Marketing and sales Marketing Strategy is planned from marketing mix including 4 elements (4P) such as: Product, Price, Place and Promotion. The successful decision of organization is providing right product at the right place and presented in the right way (HNC & HND Business 2004 [7]).
Depend on market situation, the company use one or more elements to plan marketing strategy. The marketing strategies of Tissot are built in promotion and advertising include: * High technology Tissot has launched a 3-D feature on its Web site allows consumers to use their Web cams to “try on” watches from its “Touch Collection” before purchasing them. The Swatch Group brand says it is the first time a Swiss watch brand has used 3-D augmented reality technology. It allows users to virtually “try on” watches and change models, colors and styles, using their computer screen as a virtual “mirror. 3-D technology will help customers feel more convenience when they buy Tissot product without being present at Tissot store. [8] * Public Relation (PR) Public relation (PR) is the function of marketing communication that carries out a program to earn public understanding and acceptance (Svend Hollensen, 2003) [9]. Faiz Kermani describes PR is the planned and sustained program to establish and maintain goodwill and understanding between an organization and its publics. Tissot has announced a new UK television campaign as part of a wider marketing push for the brand which will also include print advertising, in-store activity and PR.
Additionally; there are plans for watch towers that use Tissot tactile technology to be used in stores to give consumers a hands-on experience of the watches. [10] * Social Media: “Tissot Uses QR Codes to bring its Race Models to Life”: Tissot places QR codes on the outfits of its Umbrella Girls (models) at MotoGP Red Bull Grand Prix events. It makes racing fans easy to connect Tissot mobile page to purchase products and engage in special offers through their mobile. [11] * Advertising: In March 2010, Tissot launched new advertising campaign “In Touch With Your Time”.
This campaign captures real moments in the lives of famous Tissot’s ambassadors such as Nicky Hayden, Danica Patrick, Michael Owen, Deepika Padukone, and Huang Xiaoming. “In touch with your time” is far more than an advertising claim and it leads the way to a highly modern approach to luxury advertising. [12] III. PROBLEM 1. VIET NAM ENVIRONMENT Tissot entered into Viet Nam market so early, however, Vietnamese people still not know about Tissot wristwatch. One of the most serious reasons is ineffective marketing strategies.
To give right decision and right marketing campaign, Tissot has to understand clearly about Viet Nam environment and its impact. PESTEL model is used to analyze Political, Social, and Economic of Viet Nam. a) Political: According to Ministry of Finance, import tax of wristwatch reduced 0-5% from 2008 to 2013. So the import tax in 2010 for wristwatch is 20% of CIP price and 10% VAT (According to the Export/import table list publish by Vietnamese Custom [13]). This is advantage for import wristwatch because Vietnam is the member of WTO and by the agreement; the import tax will have to reduce to 0% by 2018.
Inflation in Viet Nam is a serious problem effect to Tissot watch. In 2009 inflation is about 6. 88%. In BBC Vietnamese, Citigroup considers inflation of Viet Nam in 2010 could reach 10 – 11%. That means Viet Nam currency loss value. According to Ministry of Finance 1 USD = 18. 932 Vietnam Dong (VND) and 1 CHF = 19. 521 VND. It is disadvantage for Tissot wristwatch because the Vietnamese people have to spend more to buy it. If in 2009 they spend 6 million VND for 1 Tissot wristwatch and now they have to pay 6. 5 million VND for it.
In addition, the cheap Chinese product with many “replica” models from all high branches in the world also appears in many shops which attract Vietnamese customer. b) Social: Population of Viet Nam is more than 85 million people, and increase 947 people /per year (General Statistic Office [14]). Vietnam Business News said: “The population growth rate will bring a few new consumption trends and changes in the last 10 years. A new class of high income (currently only approximately 1% of the population) will up to 10% of total population in 2016. ”[14] This is a big opportunity of Tissot for penetrating the Vietnamese market.
Vietcycle TNS data shows in 2008, less than 15% of urban people with incomes of 3 million or less, while over 45% of people have income from 4. 5 to 20 million /months. [15] c) Economic Economic of Viet Nam develops rapidly from 2009 to 2010. According to General Statistic Office, GDP in 2009 is $1000/people and it will be increase 6. 5% [16]. According to the Ministry of Commerce, currently, the rate of consumption than the GDP of Vietnam is a kind of high compared to other countries in the region (over 70% ), while Singapore’s is 55. 9%, Malaysia is 58. 2% and Thailand is 67. % … [17] The Vietnamese people have high shopping needs, especially in clothes and fashion accessories like glasses, wristwatch and so on. Following Political, Social and Economic of Viet Nam, we could conclude that: * Population of Viet Nam increase rapidly and soon will become a highest population country in Asian. GDP also increases almost 10% every year which means demand of wristwatch from Vietnamese people will rise. * Vietnamese Government also welcome with all the foreign company which invest/open brand at Viet Nam by many preferential policies. Tissot had a distributor in Viet Nam, however, Tissot still unknown brand in Viet Nam because of wrong marketing strategies and wrong analysis of big competitor – Chinese Wristwatch Company. 2. SWOT ANALYSIS: Strengths a) The quality of watches is impressive. b) The competitive price. c) Good retail network d) International tie-ups with football player Michael Owen or basketball player Tony Parker and Danica Patrick, etc…| Weaknesses People are fascinated with mobile phones rather than watches and incidentally, they show the time. Opportunities a) Watches positioned as a fashion wear rather than just utility products. b) Expanding on-site sales, outfitting a truck as a Tissot store. c) Become billion dollar brand| ThreatCompetitors: a) Japanese- Citizen, Casio b) Swiss- Rolex, Omega, Rado, Tag Heur, etc. c) Chinese watches (replica watches) d) Mobile phones and wall clocks are a substitute to watches. | a) Strengths: * Quality: When the customer buys Tissot watches, they will get a two year guarantee which is valid with any official agency Tissot worldwide.
For Tissot, the quality of the product is very important in meeting customer satisfaction. Therefore all Tissot watches are followed a comprehensive testing process strictly including: Geometrical mesurement, X-Ray Fluorescency, Oscillating Movement, Tensile and Torsion Test, Wrapping test, Experimental model assembly. The quality of Tissot watches is expressed by acting as official timekeeper and partner of MotoGP, NASCAR and the World Championships of cycling, fencing and ice hockey. [18] * Competitive price:
Customers can by fashionable, stylist Tissot wristwatch with price is 1 / 5 or 1 / 3 the amount that can buy the famous clock as the clock’s reputation United States or by 80% as the clock can be bought new style not inferior to the Japanese electronic clock. This is very strong attraction. Especially large number of low-income workers and students in EU and for medium and high income people in Viet Nam. [19] * Good retail network: With 16,000 retail distribution points in the world, Tissot’s distribution spread is unmatched by any other Swiss watch company.
In Viet Nam, Tissot has 1 authorized distributor in HCM city (Top Ten Co) and more than 5 retailers in Ha Noi. * International tie up with: Tissot signed with sport stars like football player Michael Owen or basketball player Tony Parker and racing Danica Patrick as global brand ambassadors. This relationship will affect young people who love sport. Tissot announced that it has reached an agreement with JR Motorsport as a sponsor of Danica Patrick No. 7 Nationwide Series entry through the 2011 season. b) Weaknesses: Customers are familiar with mobile phone rather than wristwatch.
Especially Vietnamese customers prefer mobile phone because of not only function by also price. They has to spend from $200 – $300 for 1 Tissot wristwatch but only with less than $200 they will purchase suitable mobile phone. c) Opportunities In 2010, Tissot is expanding on-site sales, outfitting a truck as a Tissot store. This is innovative sales opportunity for more floor space and better displays, and an overall better buying experience for Tissot customers. [20] Currently, Tissot is readying to become billion dollar watch brand like Omega, Rolex and Seiko.
This is opportunity to emphasize brand positioning of Tissot and customer’s value also. d) Threat First of all is competitor in the same range of Tissot such as Citizen, Casio, Gucci, etc… They also create much kind of wristwatches with fashionable design and competitive price. Secondly, mobile phone or cell phone also shows the time, so there are a lot of people prefer them than wristwatch. One of the most dangers is fake product. Currently, replica product appears in many items. In the market, fake wristwatches like Tissot, Gucci, Casio etc… are sold in black market with cheap price and the same design as original product.
They attract customer, especially young people or students. 3. Unique Selling Proposition (USP) Reeves (1961) [21] defines USP with three elements: * Each advertisement must make a proposition to the consumer. Each advertisement must say to each reader: “Buy this product, and you will get this specific benefit. ” * The proposition must be one that the competition either cannot, or does not, offer. It is unique benefit of product or service when customer purchase it. * The proposition must be so strong that it can move the mass millions, i. e. , pull over new customers to your product.
This is differentiation of brand or product line. The Unique Selling Point [USP] of Tissot is that the watches created by them slot into the mid-price segment, but at the same time the aesthetic quality and the workmanship of the watches can easily make one believe that they belong to the stable of Rolex, Patek Philippe etc. [22] They use the slogan “Tissot, innovators by tradition” to define their commitment to furthering the event of watches. The slogan isn’t empty words, Tissot have created many new strategies and used new supplies that are now commonplace in watch manufacture. [23] PART 2: RECOMMENDATION I.
Growth opportunities of Tissot To boost sales as well as improving the future performance of Tissot in Viet Nam market, Tissot has to identify growth opportunities in Viet Nam. To do this, we use model Ansoff’s Matrix. (David J. Campbell, Tom Craig 2005 [24]) This model mentions about 4 growth strategies including: Market penetration; Market development; Product development and Diversification. Depend on the company’s main objectives; the growth strategy will be chose. Marketing objectives and goals are what the organization achieves when developing business. The objectives and goals must be SMART for decision making.
Marketing objectives lead sales and market share of organization. Tissot’s marketing objectives including: * Increase wristwatch awareness among the customers at existing market (Viet Nam market) by 50 percent in this year * Increase sales volume 5 – 10% in this year. * Open distributor in Ha Noi city. With the objectives above, Tissot should use market penetration strategy which means the company still keep current products and launch new marketing strategies for them in Viet Nam market. Tissot should choose this strategy for 2 reasons: * Almost Vietnamese people don’t know about Tissot wristwatch. Launch new wristwatch in Viet Nam is costly strategy With this strategy, we suggest company develop marketing strategies for T-Trend collection which is wristwatch for lady. * II. Market Segmentation and Positioning of New wristwatch. 1. Segment Targeting Tissot segment market for T-Trend following population & geographic, demographic and psychographic. a) The urban area and density: Tissot T-trend mainly penetrates in major cities in Viet Nam. The reason is they are attractive market and high profitability. Population density in these cities is high so demand for purchasing wristwatch is high also. 009| Ha Noi| Ho Chi Minh| Population (mil)| 6,913| 7,163| Urban| 2. 633| 5,969| Rural| 4,280| 1,193| b) Demographic: * Sex and Age: Tissot T-Trend series is a classic style of Tissot watches which designed for lady from 25 – 40 years old. Although it is simple design collection but still shows the independent personality of modern women as well as their luscious and serious. * Income T-Trend collection has price range from $350 to $600 and it focuses on medium and high income people in Viet Nam. c) Psychographic: * Social Class: T-Trend is designed for official ladies so it focuses on C1 to A class (appendix 1) * Lifestyle:
T-Trend concentrates on ladies who have active lifestyle and fashionable. * Outdoor ladies: T-Trend Cocktail * Official ladies: T-Trend Generosi-T; T-Moments. * Fashionable ladies : T-Wave. 2. Positioning Positioning is image of product or service in customer’s mind, especially in relation to the competitor’s products. Position of the company is brand positioning, product or service positioning (Svend Hollensen 2003 [25]). Tissot build brand positioning as sponsor of sport games. Tissot invite sport stars such as Tony Baker, Michael Owen or Danica Patrick become Tissot ambassador.
This is a way to build brand positioning of Tissot. The customers always known Tissot wristwatch as sport watch brand and official timekeeper of the World Games with high quality and stylist. Compare with Gucci, Gucci is an Italian fashion and leather goods label. Gucci started by designing handbags, clothes and become famous brand in the world. Currently, Gucci expanded in wristwatch industry by fashionable design and stylist wristwatch. Gucci building brand position by status means Gucci turned Gucci brand become indispensable outfits for anyone who wants to be stylist and fashion people.
Therefore in people’s mind, even when anyone uses Gucci products they are sophisticated and rich people. III. Selected Marketing Strategy To get successful development at Viet Nam market in the future, we suggest Tissot in promotion. 1) Advertising Tissot should focus on advertising the new product in Viet Nam. The effective advertising channel includes online channel, TV, radio. A research of Nielsen Company about the reliability on the ad shows that 60% of Vietnamese people interviewed said they believe in other forms of advertising.
In the research, traditional advertising channels likeword of mouth advertising, television and newspapers, respectively accounting forposition 1, 2 and 3, corresponding to 79%, 73% and 72%. (vietbao. vn [26]) 2) Get new ambassador: Vietnmese people don’t have knowledge about star sport in the world. They are care about singers, actress or fashionable people in the world. So Tissot should connect with singer or actress in Viet Nam to advertise wristwatch for lady. PART 3: CONCLUSION Appendix: 1) Social class: Class| Description| A| Upper managerial, admin, or professional|
B| Intermediate managerial, admin, or professional| C1| Supervisor, junior managerial, admin or professional| C2| Skilled manual workers| D| Semi- and unskilled manual workers| E| State pensioners, widows, casual workers| REFERENCE * Federation of the Swiss Watch Industry FH © 2010, “The Swiss and world watch making industry in 2009”, [Online] available: http://www. fhs. ch/statistics/watchmaking_2009. pdf * Swiss economy finds competitive advantage, written by Matthew Allen (Dec 12, 2010 10:26) available: http://www. swissinfo. ch/eng/business/Swiss_economy_finds_competitive_advantage. tml? cid=29002240 * Tissot history, available: http://www. tissot. ch/? mod_communication/chapter_history * The Hindu Business Line, It’s time for Tissot’s first billion, written by K. Rajeshwari (Thursday, Apr 01, 2010) [Online] available: http://www. thehindubusinessline. com/catalyst/2010/04/01/stories/2010040150090300. htm * Watch Market Review © 2009, Tissot poised to become billion dollar brand, available: http://www. watchmarketreview. com/may10/news. html * Tissot Swiss advertising planning book, Copyright © 2010. www. appwatches. org available: http://www. ppwatches. org/news-Tissot-Swiss-advertising-planning-book-88. html * Edexcel HNC&HND Business (2004), Marketing: Supporting Foundation Degrees. ISBN: 0- 7517- 1243- 4. (pp. 21-27). * Copyright Ebner Publishing International © 2011, “Tissot Lets You Try on Virtual Watches in Real Time 3D”, written by Mike Disher, (May 06, 2010) available: http://www. watchtime. com/2010/05/tissot-lets-you-try-on-virtual-watches-in-real-time-3d/ * Svend Hollensen (2003), Marketing Management: A relationship Approach. ISBN: 0-273-64378-9 (pp. 454, pp. 565) * © 2010 Emap Ltd,
